Pension scheme members opting for an Alternative Secured Income when reaching age 75 will be able to nominate a person who is not a relative to receive any possible surplus funds upon their death, Scottish Equitable reveals.
Speaking at Scot Eq's pensions roadshows in London on Wednesday, pensions development director Stewart Ritchie pointed out the ASI option will allow members of a pension scheme to choose a non-related person to get their remaining pot upon death if they do not have any dependants.
ASI, which comes into effect in April 2006 as part of simplification legislation, will give a scheme member without any dependants the choice of either letting any surplus cash go back to the scheme or to a selected charity.
While the former option could see individual members of smaller pension schemes benefit significantly, members of larger ones would hardly notice any difference, Ritchie said.
However, latest proposals suggest members will now be able to decide who exactly within the same scheme is to benefit from any possible leftovers.
This looks "very interesting", said Ritchie, who believes it could prove to be very "tax-efficient". However, he could not reveal anything further as he said "we are still awaiting all the details".IFAonline
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